WHEREAS, all states had school land trust funds first established by the federal 1785 Land Ordinance and later legislation, but short-sighted state governments exhausted most of these trusts so that only 20 remain today, underscoring the idea that government appropriators should be fully separate from the stewards of an educational trust fund; and  

WHEREAS, the Permanent School Fund was established by the 1845 Texas Constitution as a perpetual fund and evolved into an investment fund in 1854 with the infusion of two million dollars in United States Bonds; and

WHEREAS, in the Fund’s early years, the state leveraged it to make risky railroad loans and eroded its monies to support the Confederate war effort, so that in 1875, the framers of the 1876 Constitution wisely sought to entrust the Fund to a body devoted solely to education, the State Board of Education; and

WHEREAS, while the composition and format of the State Board of Education (SBOE) has changed over the years, the current elected board is directly accountable to Texas voters, functions independently of the legislative and executive branches, and deliberates in a completely transparent fashion; and

WHEREAS, under the State Board of Education’s management, between 2006 and 2021, the SBOE’s portion of the fund will have distributed nearly $12.4 billion to Texas schools, based on a sustainable total return approach striving to balance present and future student needs while taking into account inflation, student growth, and the growth and preservation of the Fund’s corpus; and

WHEREAS, because the SBOE is also responsible for instructional materials adoptions, it can effectively coordinate Fund distributions with its materials adoption cycles; and

WHEREAS, under the State Board of Education’s careful and prudent principal stewardship, the total Fund has over the past decade grown into the nation’s largest educational endowment with a value of more than $44 billion and has achieved earnings over the last decade that place it in the top one-third of all similar funds in the nation, while implementing investment diversification strategies to mitigate impact of inevitable market downturns; and

WHEREAS, while growing in the current decade-long bull market, the fund has also maintained the liquidity required to sustain a Aaa stable credit profile rating in order to guarantee $80 billion in school district and charter school bonds, thereby annually saving taxpayers $200 million in interest payments and insurance costs; and

WHEREAS, while the Permanent School Fund pays management fees as do all other peer funds, the State Board of Education has sought to develop strategic partnerships and achieve effective in-house management so that total management and administrative fees for each asset class are at or below industry norms; and

WHEREAS, Plank 132 of the 2018 Republican Party of Texas Platform states that the elected State Board of Education should retain constitutional authority over the Permanent School Fund; now

THEREFORE, BE IT RESOLVED that the State Republican Executive Committee reaffirms our commitment that the elected State Board of Education remain directly accountable to Texas citizens and independent of the legislative and executive branches, responsible for managing the Permanent School Fund through transparent deliberations and active public engagement;

BE IT FURTHER RESOLVED that this resolution be forwarded to all members of the Texas Legislature, all members of the State Board of Education, Governor Greg Abbott, Lt. Governor Dan Patrick, and Speaker Dennis Bonnen.